Nonperforming loans in the euro area: <scp>A</scp>re core–periphery banking markets fragmented?

Anastasiou, Dimitrios; Louri, Helen; Tsionas, Efthymios G.

doi:10.1002/ijfe.1651

Cited by 70 publications

(49 citation statements)

References 41 publications

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“…Higher global risk aversion (VIX) was also found to generate an increase of NPLs. Anastasiou et al (2016) differentiate between core and periphery Euro area countries and find that, despite being affected by the same macroeconomic and bankspecific variables in both categories, NPLs respond much softer to changes in macroeconomic conditions in peripheral countries (GIIPS). Fell et al (2016) and Fell et al (2017) focus on the mechanics of secondary NPL markets, analysing indicators of market failure which impede their efficient functioning and follow up with policy recommendations for alleviating these deficiencies.…”

Section: Literature Reviewmentioning

confidence: 96%

Determinants of Non-Performing Loans for the EEC Region. A Financial Stability Perspective

Tatarici

Kubinschi

Barnea

2020

Management &Amp; Marketing. Challenges for the Knowledge Society

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This article investigates the determinants of non-performing loans for a panel of EEC countries and the implications for the real economy, covering the period 2005-2017. Among the determinants, the paper proposes macroeconomic factors, banking sector variables, and cost and governance indicators. Additionally, the paper explores the extensive use of macroprudential measures in these countries. Using a panel with fixed effects and a dynamic GMM estimator, the results support the existing findings that adverse macroeconomic developments are generally associated with higher non-performing loans, while increases in NPLs have a rather transitory effect on the real economy and credit. NPL ratios increase if macroeconomic conditions deteriorate, while an improvement in the government effectiveness reduces them. A more profitable and better capitalized banking sector generally leads to lower NPLs. Moreover, countries with higher past credit growth rates witnessed higher NPLs in the periods that followed. These results support the use of macroprudential measures for increasing the resilience of borrowers, such as limits on the indebtedness level (such as debt service-to-income, DSTI or loan-to-value, LTV caps), as tools to temper the credit cycle.

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Section: Literature Reviewmentioning

confidence: 96%

Determinants of Non-Performing Loans for the EEC Region. A Financial Stability Perspective

Tatarici

Kubinschi

Barnea

2020

Management &Amp; Marketing. Challenges for the Knowledge Society

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“…For a review of the topic on the years before the 2007 crisis, see Beck et al (2015), Ghosh (2015), Ozili (2015) and Tanaskovi c and Jandri c (2015). Studies that have considered the causes of rising NPLs after the 2007 financial crisis for (all or some) EU countries include: Skarica (2014), Beck et al (2015), Barra et al (2016), Tanaskovi c and Jandri c (2015) and Anastasiou et al (2016Anastasiou et al ( , 2019a [1]. Skarica (2014) is the first empirical study on the countries of the CEE region using aggregate, country-level data on problem loans.…”

Section: A Short Review Of the Empirical Studies On Npls In European Countriesmentioning

confidence: 99%

“…In the case of share prices, the impact is found to be larger in countries which have a large stock market relative to GDP. Anastasiou et al (2016Anastasiou et al ( , 2019a use GMM estimations and VAR to identify the main determinants of NPLs in the Euro-area banking system for the period 1990Q1-2015Q2 and for the period 2003-2016. The independent variables are: (1) ROA and ROE, which reveal the managerial efficiency of a bank to convert its assets and equity into returns (profits).…”

Section: The Impacts Of Government Failures On Nplsmentioning

confidence: 99%

Government failures and non-performing loans in European countries: a spatial approach

Ofria

Mucciardi

2021

JES

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PurposeThe purpose is to analyze the spatially varying impacts of corruption and public debt as % of GDP (proxies of government failures) on non-performing loans (NPLs) in European countries; comparing two periods: one prior to the crisis of 2007 and another one after that. The authors first modeled the NPLs with an ordinary lest square (OLS) regression and found clear evidence of spatial instability in the distribution of the residuals. As a second step, the authors utilized the geographically weighted regression (GWR) to explore regional variations in the relationship between NPLs and the proxies of “Government failures”.Design/methodology/approachThe authors first modeled the NPL with an OLS regression and found clear evidence of spatial instability in the distribution of the residuals. As a second step, the author utilized the Geographically Weighted Regression (GWR) (Fotheringham et al., 2002) to explore regional variations in the relationship between NPLs and proxies of “Government failures” (corruption and public debt as % of GDP).FindingsThe results confirm that corruption and public debt as % of GDP, after the crisis of 2007, have affected significantly on NPLs of the EU countries and the following countries neighboring the EU: Switzerland, Iceland, Norway, Montenegro, and Turkey.Originality/valueIn a spatial prospective, unprecedented in the literature, this research focused on the impact of corruption and public debt as % of GDP on NPLs in European countries. The positive correlation, as expected, between public debt and NPLs highlights that fiscal problems in Eurozone countries have led to an important rise of problem loans. The impact of institutional corruption on NPLs reports that the higher the corruption, the higher is the level of NPLs.

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“…In the field of economics, economics grow by upgrading the type of products they produce and export (Hidalgo et al 2007). The core-periphery structure appears in various trade networks (Fricke and Lux 2015;Nemeth and Smith 1985) and financial networks (Hughes and Holland 1994;Malecki 1997;Anastasiou et al 2019), which can help explain many economic mechanisms (Bailin 2017). The product space (Hidalgo et al 2007) can be described by a bipartite network, where a node indicates a country or a type of product, and a weighted edge between country and product indicate the ratio to the total amount of imported or exported products.…”

Section: Core-periphery Structure In the Field Of Economymentioning

confidence: 99%

Recent advance on detecting core-periphery structure: a survey

Wen-li

Zhao

Liu

et al. 2019

CCF Trans. Pervasive Comp. Interact.

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Recently, one type of mesoscale structure called core-periphery (CP) structure has received much attention in complex networks, as the algorithmic detection of such structures makes it possible to discover network features that are not apparent either at the local scale of nodes and edges or at the global scale of summary statistics. The core-periphery structure refers to that core nodes are densely interconnected, while periphery nodes are connected to core nodes to different extents, and periphery nodes are sparsely interconnected. Core-periphery structure containing a single core or multiple cores has been identified in various networks. However, investigation of the detection problems of the core-periphery has not been summarized in the literature. In this paper, we first introduce the definition of the core-periphery structure. The core-periphery structure has been paid more and more attention by researchers in various fields since its introduction, and it has been proved to be a powerful tool to analyze the theory of various topologies in our society, we briefly expounded the application of core-periphery structure in economics, sociology, medicine and other fields, and revealed the huge development potential of this theory. Then, we give a detailed overview of classical detection algorithms since the core-periphery structure theory was proposed. Finally, we give the development characteristics and the possible research directions of the core-periphery detection algorithm.

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Nonperforming loans in the euro area: Are core–periphery banking markets fragmented?

Cited by 70 publications

References 41 publications

Determinants of Non-Performing Loans for the EEC Region. A Financial Stability Perspective

Determinants of Non-Performing Loans for the EEC Region. A Financial Stability Perspective

Government failures and non-performing loans in European countries: a spatial approach

Recent advance on detecting core-periphery structure: a survey

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